“Most Seed Stage Start-up raises are under $500k.
Not the ones that will be the "next Facebook"
All the rest from major cities to regional towns.
We need to empower these brave supporters and innovators in their early days.
They move forward tranche by tranche as goals are achieved until ready for a Series A.
However ... the centralised regulatory and cost structure does not empower this area of funding.
Including proposed Online CSEF regs.
In the U.S. nearly 60 billion of funding is in this class roughly equal to 58 billion by VC, Angel and Bank finance to the same space.
Lets firstly legitimise it, lower the cost and then empower it.
Lets have:
1) Investment legitimisation at the "small end" that is seen as primarily funding not as an asset class play.
2) An open, shared, fully transparent, zero cost, trust based transactional recording and reporting
environment where all Stakeholders including ASIC play. Why should everyone have separate ledgers for the same information and costly external trust guardians when the transaction should be the trust identifier.
Goal would be that eventually this would be blockchain powered.
This would remove annual cost of keeping filing info up to date with ASIC, accountants costs for duplicate share registries, real time deal reporting with continual visibility on transaction volume so abnormalities can be addressed by regulator and stakeholders, standarised templates to lower costs, transactions permanently stored with full transparent history, clear unambiguous risk warnings time stamped accepted and recorded as part of the open, shared, fully transparent, zero cost, trust based transactional recording and reporting environment.
You wont need big buildings, bank vaults and floors of filing cabinets in the future to evidence a trust based funding transaction. Lets get a lead in the world and empower these brave passionate supporters and innovators now.
”

What about this Marcus: ======> 1) Friends, Fans, Family and Supporters can contribute up to $500k IN TOTAL financially to Startups as easily as buying something on eBay and both parties take full responsibility for the investment decision not the government or intermediaries =========> 2) Small Businesses transactions take place in a shared, transparent, trust based environment RATHER THAN a regulatory and reporting structure designed in a non-digital age that costs that treats them like they are listed in a stock exchange.

Paul Niederer
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3 years ago

As a less economically savvy student, what are we basically saying here? I'd like to talk about the ideal first and how it affects the 'innovative ecosystem' before getting caught up in the details.

Marcus Newton
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3 years ago

What about this Marcus: ======> 1) Friends, Fans, Family and Supporters can contribute up to $500k IN TOTAL financially to Startups as easily as buying something on eBay and both parties take full responsibility for the investment decision not the government or intermediaries =========> 2) Small Businesses transactions take place in a shared, transparent, trust based environment RATHER THAN a regulatory and reporting structure designed in a non-digital age that costs that treats them like they are listed in a stock exchange.

Paul Niederer
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3 years ago

Spot on , as usual, Paul!

christine doan
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3 years ago

Well done Paul, it takes a lot to keep great ideas and opportunities moving forward in Australia and this approach is essential if we want to keep the great companies here and not lose our best and brightest to the overseas market, as has been so often the case in the past. Costs must be kept down if early stage opportunities are to succeed. Keep up the good work!

gavin loyden
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3 years ago

Paul - you are one of a handful of people in Australia with a professional background knowledge and understanding of this hugely important topic. Congratulations on this excellent suggestion and post.

Tony Chadwick
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3 years ago

Well said, Paul. Australia has more history in this space than any other country. The simple does not need to involve boiling the oceans. Some simple changes will free up this space yet still protect small investors. ASSOB and Capital Exchange Australia are already operating in this arena - we just need to make a small number of changes to legislation to free up growth in innovation, jobs, and the economy at a grass roots level

Bryan Vadas
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3 years ago

Commonsense, innovation and collaborative spirit.
Its all here as laid out by Paul N.....
Its that TIME

Chris Wakeford
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3 years ago

And mitigate the risks undertaken by angel investors by providing matching funding or tax breaks.